Indian children are on the shorter side when compared with children of other similar countries.
Bias for the boy child, seen often in India, is the chief factor responsible.
There’s often talk about how over the last 50 years the Japanese and Koreans have grown taller on average. But have you noticed how short Indian children are? Or, how first-born children tend to be smarter than their younger siblings?
A couple of data-happy economists, Seema Jayachandran and Rohin Pande, have studied just that. Their findings were published a couple of years ago in a paper titled ‘Why Are Indian Children So Short?’ They say the preference for sons ensures that the gradient from the first to the last child is steeper than in other comparable regions of the world.
In most of the developed world, economic growth has been associated with an increase in the height of the population. This trend, however, has failed to establish itself in India and Africa, the two regions under consideration in the study. The paper finds that between 1992 and 2005, India’s economic growth was higher than 6 per cent per year – resulting in a higher per capita GDP than over 100 countries; yet the rate of stunting among children in India in 2005 was a shocking 40 per cent, the fifth-highest rate in the world.
According to the paper, this could in large part be due to the preference for sons, the desire for that son to be healthy, and the consequent inequity in resources allocated between the eldest son and the subsequent siblings, whether boy or girl.
If a family’s first-born child is a son, then the family will spend a large proportion of their resources in keeping that child healthy and well-fed, and will naturally have fewer resources for the subsequent children. This follows the hypothesis that first-borns are taller and healthier.
However, the stark preference for a boy over a girl has an interesting – if unfortunate – effect on this trend. If a family expects to have two children and the first happens to be a girl, then the paper hypothesises that the parents will allocate fewer resources to the girl in the hope that the next child will be a son. They also tend to conserve their resources because they feel that, with the first child being a girl, it is increasingly unlikely that their desire for a son will be fulfilled within their target of two children.
Now, if the second child is also a girl, then she receives even fewer resources because not only is she not the eldest, but now the family will have to try for three children in order to have a son. And once the son is born, he is showered with all the resources the parents can afford to spend as he is considered an asset, while the girls are viewed as a drain on the resources.
The paper states, optimistically, that “one might expect unequal allocation in the household to matter less as India develops”, but then goes on to find that when households are compared by wealth, the birth order gradient is actually relatively large among wealthier households.
“Thus, India appears to still be far from the level of wealth at which, despite unequal allocation, children are all sufficiently nourished.
“This implies that even as India develops, the problem of malnutrition might be slow to fade, unless policies are put in place that influence or counteract the intra-household allocation decisions that parents are making,” the paper says, which is a sad commentary on the current state of India.
Quite apart from the differences in allocation of food within households, about which Amartya Sen had written in 1983, India faces a much larger problem of malnutrition. The average IQ (intelligence quotient) in India is now below 90, which is a significant challenge for developing a properly skilled workforce.
It is not clear if there is enough awareness of the problem that this creates because the dependency ratio will increase not only because of demography but also intelligence. There is an urgent need to address this problem by ensuring enough supply of protein to children between the ages of one and 10. Just a glass of milk and a banana or an egg every day will do. Perhaps this should be made a compulsory element of corporate social responsibility. Agencies like Akshay Patra can be entrusted with the task.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.